LHMU v Achieve Cleaning Services Pty Ltd - [2010] FMCA 362

FEDERAL MAGISTRATES COURT OF AUSTRALIA

LHMU v ACHIEVE CLEANING SERVICES PTY LTD

[2010] FMCA 362

INDUSTRIAL LAW – Wilful breach of Workplace Relations Act – appointment of bargaining agent pursuant to s335 WRA – penalty – matters relevant to quantum of penalty.

Workplace Relations Act1996 (Cth)

Amos v Brisbane City Council [2005] QCA 443
Barnard John Cooper v Director Liquor Licensing [1999] WASCA 1021
Beckwith v R (1976) 135 CLR 569
CF Finance Sector Union v Commonwealth of Australia (2005) 47 IR 462 Chew v R (1992) 173 CLR 626
Dickinson v Fletcher (1873) LR 9 CP 1
Krakouer v R (1998) 194 CLR 202
Murphy v Farmer (1988) 165 CLR 19
National Tertiary Education Industry Union v Central Queensland University [2008] FCA 481
R v Adams (1935) 53 CLR 563 at 567 – 568
R v Crabbe (1985) 156 CLR 464
Re HPC Productions Ltd [1962] 1 CH 466
Rich v Australian Securities and Investments Commission (2004) 220 CLR 129
Rojos v Esselte Australia Pty Ltd (No.2) [2008] FCA 1585
Tabe v R (2005) 79 ALJR 1890
Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1

Applicant:

LIQUOR HOSPITALITY & MISCELLANEOUS UNION

Respondent:

ACHIEVE CLEANIING SERVICES PTY LTD

File Number:

BRG 168 of 2009

Judgment of:

Burnett FM

Hearing date:

12 June 2009

Date of Last Submission:

24 June 2009

Delivered at:

Brisbane

Delivered on:

26 May 2010

REPRESENTATION

Counsel for the Applicant:

Mr Reed

Solicitors for the Applicant:

Liquor Hospitality and Miscellaneous Union

Counsel for the Respondent:

Mr Coveney

Solicitors for the Respondent:

HWL Ebsworth

ORDERS

That pursuant to section 407(1) and section 407(2)(b) of the Workplace Relations Act the respondent pay a pecuniary penalty fixed in the sum of $11,000.00 for contravention of section 335(3) of the Workplace Relations Act.
That pursuant to section 841 of the Workplace Relations Act the penalty imposed on the respondent pursuant to Order 1 herein be paid to the applicant.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
BRISBANE

BRG 168 of 2009

LIQUOR HOSPITALITY & MISCELLANEOUS UNION

Applicant

And

ACHIEVE CLEANING SERVICES PTY LTD

Respondent

REASONS FOR JUDGMENT

Introduction

In late 2008 Achieve Cleaning Services Pty Ltd (Achieve) was proposing a new Employee Collective Agreement (ECA) for its employees many of whom were employed at the Anglo Coal Mine at Moura, Central Queensland. One of Achieve’s employees was Peter Sawyer. He had commenced employment with Achieve in about July or August 2008 and was employed as a cleaner on a casual basis. On 14 November 2008 he joined the applicant, Liquor Hospitality & Miscellaneous Union (LHMU) and from around that time acted as the LHMU delegate at the mine.
In early 2008 Mr Sawyer became aware that Achieve was proposing a new ECA. On 9 December he contacted Ben Jones (Jones), an LHMU official, and requested of Jones that the LHMU act as Mr Sawyer’s bargaining agent in relation to the proposed ECA. Jones acknowledged and accepted that request.
On 10 December 2008 Jones caused a letter to be forwarded by fax to Achieve concerning the proposed ECA. His fax was followed by a number of telephone calls to the executives of Achieve and also two subsequent letters forwarded on 15 and 16 December 2008. Other efforts were made to contact management of Achieve. However all efforts proved to be unsuccessful. Achieve made no contact with the LHMU.
On 23 January 2009 Achieve entered into the ECA which in turn was forwarded to the Workplace Authority for assessment and ratification. The Workplace Authority subsequently assessed and ratified the ECA.
In obtaining that outcome the LHMU allege that Achieve contravened section 335(3) of the Workplace Relations Act by failing to give it, as a bargaining agent, a reasonable opportunity to meet and confer with Achieve about the proposed ECA during the relevant period or at all. The LHMU seek the imposition of a civil penalty.

Legislation

The LHMU’s complaint is founded in section 335 of the Workplace Relations Act. Relevantly it provides:
“(1) An employee whose employment is or will be subject to an employee collective agreement may request another person (the bargaining agent) to represent the employee in meeting and conferring with the employer about the making or variation of the agreement.
(2) An employee whose employment is or will be subject to an employer greenfields agreement may request another person (the bargaining agent) to represent the employee in meeting and conferring with the employer about the variation of the agreement.
(3) The employer must give the bargaining agent a reasonable opportunity to meet and confer with the employer about the agreement during the period:
(a) beginning 7 days before the agreement or variation is approved in accordance with section 340 or section 373; and
(b) ending when the agreement or variation is approved.
(4) Subsection (3) is a civil remedy provision.
(5) The requirement in subsection (3) ceases to apply to the employer if at any time after the request is made the employee withdraws the request.
(6) The Workplace Authority Director may issue a certificate that he or she is satisfied of one of the following matters if he or she is so satisfied:
(a) on application by a bargaining agent—that the employee has made a request in accordance with subsection (1) or (2) for the bargaining agent to represent the employee in meeting and conferring with the employer;
(b) on application by the employer—that, after the making of the request, the requirement in subsection (3) for the employer to give a reasonable opportunity to the bargaining agent to meet and confer, has, because of subsection (5), ceased to apply to the employer.
(7) The certificate must not identify any of the employees concerned. However, it must identify the bargaining agent, the employer and the agreement.
(8) The certificate is, for all purposes of this Act, prima facie evidence that the employee or employees made the request or that the requirement has ceased to apply.”
Section 407 provides for the ordering of pecuniary penalties for the contravention of civil remedy provisions of which s335 is one.

Background Facts

The association between the LHMU and Achieve extended to well before the events of December 2008. Mr Jones had had dealings with Achieve on at least 15 occasions prior to the subject ECA. As recently as 6 August 2008 the LHMU had participated in a meeting with executives from Achieve concerning another agreement, the Building Service Contractors Association of Australia – Queensland Division, Coal Mining Industry Certified Agreement 2003 and discussed a need for its renegotiation because it had passed its expiry date. It is plain from the “talking points” minute that formed the LHMU’s points for discussion at that meeting that the talks of 6 August constituted the opening round in negotiations for employees ultimately to be covered by the proposed ECA. In particular it was noted that the LHMU wished to negotiate in tandem with the CFMEU, another union with whom the LHMU had negotiated replacement agreements with other industry players since 2005/2006.
On 5 December Sawyer put to Achieve a list of grievances in relation to Achieve employees wages and conditions of employment. This was put by forwarding the list by fax to John Powell, Achieve’s Managing Director.
A few days later on 8 December Christian Larsen, Achieve’s Site Manager attended the Moura worksite and distributed by hand copies of the proposed ECA. At that time Larsen was telling employees that there would shortly be a meeting of staff to talk about the proposed ECA and that the employees had seven days to consider the matter but that Achieve wanted the employees to “…sign this piece of paper relinquishing your right to this seven day notice period.”
Sawyer refused that invitation stating that he wanted seven days to review the agreement.
On 9 December the LHMU was formally appointed bargaining agent by Sawyer. At the time of appointment the LHMU was informed by Sawyer through its official, Jones, that:
a)Sawyer had become aware of the proposed ECA on 8 December 2008; and
b)Sawyer authorised the LHMU to deal with the Australian Workplace Authority in relation to the ECA.
Following the union’s appointment Mr Jones caused a letter to be forwarded to Achieve by fax on 10 December. Materially it stated:
“LHMU is representing employees engaged by your company at Anglo Coal Moura/Dawson Mine.
Our members advise that you have proposed to make a collective agreement with them.
LHMU wish to meet with you, as a matter of priority, to discuss your proposal.
Until such time as we have met to discuss your proposed collective agreement, we request that you defer any further action on the matter, including any proposed balloting process.
Please contact Mr Ben Jones on 07 3291 4639 or 0439 758 894 as a matter of priority to arrange a meeting to discuss this matter.”
The next day at about 11.00am it was followed by a phone call to the mobile phone of Achieve’s executive manager, Michael Pucci. Mr Pucci did not answer his phone and a request was made that he return the call “…to discuss a potential meeting in relation to the proposed making of a new agreement.”
A short time later at 11.07am Mr Jones phoned Achieve’s Woolloongabba office and asked to speak with either Diane Paznikov (Achieve’s Office Manager) or Gay Borodin (Achieve’s Managing Director) but neither were available. A message was left with the receptionist requesting either Paznikov or Borodin to return his call “…in relation to a potential meeting in relation to the proposed making of a new agreement.”
Later that day Mr Jones caused a second letter to be forwarded to Achieve. In part that letter stated:
“As per our previous advice, you are aware that we represent employees who you wish to make a collective agreement with.
We reiterate our request for a meeting to discuss this matter.
We have been advised of some irregularities in your proposed voting procedure.
Some members have advised us of their being required to vote to approve an agreement in the absence of their having seen a document or being granted access to peruse a document. Similarly, members advise that they have not been provided with any information about the process of making a collective agreement, nor have they been provided with an employee information statement from the Workplace Authority as required by law.
Further we are advised that employees are being asked to sign a “waiver” and vote prior to having the statutory seven day consideration period. You should note that it is our view that for a collective agreement, all employees will sign a waiver for any “early” votes to be valid. On that view, if any employee signs a waiver and votes early, whilst others do not sign a waiver, then the overall ballot process is invalid.
It appears from our information that your process for making a collective agreement is fatally flawed and you cannot proceed to seek approval from the Workplace Authority under such circumstances.
Please contact LHMU Property Services Coordinator Ben Jones on 0439 758 894 as a matter of urgency to discuss this matter further.”
Although Achieve denies receiving this correspondence in its pleading no evidence was adduced in support of that contention. I accept the evidence of Mr Jones that this letter was successfully transmitted by fax to Achieve as he deposed.
Coincidentally on that same day, 10 December at the Rotary Park, Moura, an offsite staff meeting was called by the union for the LHMU members, other staff and union officials to discuss the proposed ECA.
During the course of the meeting both Powell and Achieve’s Site Manager, Christian Larsen were noted to be observing events from an adjacent car park. Although it is not clear how proximate the car park was to the meeting it must have been sufficiently proximate for at about 2.30pm they interrupted the meeting and requested the union officials to leave saying words to the effect of:
“We are not dealing with the LHMU about this. We do not want the unions involved.”
During the course of this exchange Larsen handed out copies of an amended proposed ECA. The amendments appear only to have been of a minor and insubstantial nature. At the same time Powell told employees they should vote “yes” and that if they didn’t, that is if they voted “no”, they would go back to the Federal Award and “… back to 15 bucks an hour and nothing else” and that Achieve wanted the employees “… to vote for the agreement here and now.”
Powell and Larsen did not appear to gain much traction and shortly after departed the area at about 3.00pm leaving the union officials to continue their discussion with those employees then present.
In his evidence Sawyer stated that Powell’s disposition at the time he made the statements was one of hostility. Sawyer observed that Powell was “not amused about the whole situation” at the time and that he was being unpleasant towards the union organiser.
Although something was sought to be made in cross examination of Sawyer and the reliability of that evidence I accept his evidence on those matters. Although Mr Sawyer was not an educated man he did impress me as a person capable of understanding the events unfolding before him. He might not have had a precise recollection of the words but the manner and effect of the words spoken to him left him with a clear impression of the nature and effect of Powell’s statements. No evidence was led to the contrary. Accordingly I accept Sawyer’s recollection of these matters and importantly of the impression he gained of the intended effect of Powell’s statements and his attitude as demonstrated at the Rotary Park meeting.
The following day, 16 December, Mr Jones called the mobile phone of Powell. He did not answer his phone. Mr Jones left a message asking him to return the call “…in relation to the proposed making of the collective agreement.”
Later that day Mr Jones caused a third letter to be sent to Achieve by fax. Materially that letter stated:
“LHMU have already raised with you contraventions of the Workplace Relations Act in relation to the conduct of the process for making a collective agreement engaged in by your company.
We reiterate that employees report that they have not been given access to a copy of the agreement, an information statement from the Workplace Authority or at least seven days to consider the proposed agreement. We also have information that employees have felt coerced and misled as to the process of making an agreement and the proposed terms.
It is our view that the process contravenes the Act, and agreement cannot be said to be properly approved by employees. …
Further we have attempted to meet with you to discuss these issues, but you have yet to respond to our request. We reiterate that we represent employees who you seek to cover under the proposed agreement.
Note that the Act prescribes that you must gives (sic) a reasonable opportunity to meet and confer with you before the agreement is approved. If you fail to do so, you will breach the Act. …
… Please contact LHMU Property Services Coordinator Ben Jones on 0439 758 894 to discuss this matter further.”
On 17 December Mr Jones called Cathy Lynch, Executive Director of the Building Services Contractors Association of Australia, Queensland Division, Industrial Organisation of Employees, an organisation he knew Achieve to be a member of. He informed her that LHMU were concerned Achieve proposed a new ECA and that they had not consulted with the union. Ms Lynch undertook to raise the union’s concerns with Pucci and ask him to contact it.
By letter dated 19 December 2008 the Workplace Authority forwarded to the LHMU a “Certificate of Request made of Bargaining Agent”. A copy of the certificate was never forwarded to Achieve.
In the meantime on 14 January 2009 the Australian Workplace Authority approved the ECA and it became binding from that date.
Unaware that the proposed ECA had been approved Mr Jones continued to pursue Achieve. On 16 January 2009 at about 11.30am he spoke with Paznikov of Achieve. She was unable to provide him with any information about the ballot and he requested that she have Pucci call him regarding a proposed meeting to discuss the making of the collective agreement.
Mr Jones deposed that apart from the specific occasions identified above he also unsuccessfully sought to contact representatives of Achieve including Powell and Pucci by telephone between 15 December and 6 January in attempts to organise a meeting to discuss the making of the collective agreement.
Despite all the efforts particularised above no one from Achieve sought to contact Mr Jones or any other member of the union.
Given the unresponsive conduct of Achieve the union had no notice for voting on the proposed ECA or any other decision process to approve the ECA.
The vote for the proposed ECA was taken in early January and the proposed ECA as voted upon was forwarded to the Workplace Authority for ratification and subsequently ratified on 14 January and became binding from that date.

Issues

The respondents submitted that the bargaining agent once appointed must clearly inform the employer that a request has been made so as to properly establish an entitlement to bargain on behalf of the employee or employees. It was submitted that at no time did the applicant indicate with sufficient certainty or clarity to the respondent that it had been appointed a bargaining agent within the meaning of the Act. On that basis any ambiguity in the legislation should be constructed in favour of the applicant.
In its defence Achieve says the facts do not support a contravention of section 335(3) Workplace Relations Act because no notice was ever given by the LHMU of its appointment to act as bargaining agent. Three issues arise in the defence being:
a)What form of notice must be given to an employer of appointment of bargaining agent;
b)By whom must such notice be given; and
c)Whether LHMU gave notice of its appointment as bargaining agent and if so how.

Principles of construction

The respondent contends it could not contravene section 335(3) of the Act as there was a doubt in the language of that provision as to whether an employer is entitled to be informed of the ‘request’ pursuant to which the bargaining agent has been appointed. It was contended that any doubt on this point should be resolved in the respondent’s favour because of the penal character of the provision.
The principles of construction to be applied are not contentious. A provision providing for a pecuniary penalty is to be interpreted in a manner consistent with the approach to the interpretation of penal statues; Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 at 47 – 48; Rich v Australian Securities and Investments Commission (2004) 220 CLR 129.
In the interpretation of penal statutes the ordinary rules of construction apply. If the language of the statute remains ambiguous or doubtful then the person against whom the penalty is sought to be enforced is entitled to the benefit of the doubt; Chew v R (1992) 173 CLR 626 at 632; R v Adams (1935) 53 CLR 563 at 567 – 568; Beckwith v R (1976) 135 CLR 569 at 576. Similarly a court cannot ignore the clear words of a provision so as to give it a meaning that would or might make it easier to impose a penalty if the intention of the legislature is at best a matter of contestable opinion; Krakouer v R (1998) 194 CLR 202. The applicant for the imposition of penalty must show that the words of the Act distinctly enact that it shall be incurred under the then present circumstances; Dickinson v Fletcher (1873) L R 9CP 1 at 7 per Brett J approved by the High Court in Murphy v Farmer (1988) 165 CLR 19 at 29. Finally if the language of the statute is equivocal and there are two reasonable meanings of that language then the interpretation which will avoid the penalty is to be adopted; Re HPC Productions Ltd [1962] CH 466 at 485.

Form of Notice

The Act is silent on if and the manner in which a bargaining agent ought to give notice of its appointment to an employer. The respondent contends that in the absence of any notice of appointment as bargaining agent it could not have failed in its obligations under section 335(3).
In section 335(1) the bargaining agent is the person requested by an employee “to represent the employee in conferring with the employer about the making” of a collective agreement. Although section 335(6) provides for the Workplace Authority Director to issue a certificate of satisfaction that an employee has made a request for a bargaining agent to represent an employee that requirement is not mandatory. It is worth noting that this regime varies from that which applies to the appointment of a bargaining agent in relation to AWAs; see section 334.
Given the objects provided in section 3 of the Act and the discretionary power of the Workplace Authority Director to issue a certificate it seems apparent that the words of section 335(3) were not intended to import any strict form in the giving of notice of appointment by a bargaining agent to an employer. However it is axiomatic that some notice must be given for without notice of appointment of bargaining agent an employer would never fail to afford a reasonable opportunity to meet and confer.
It was submitted for the respondent that in construction of section 335(3) I should have particular regard to the explanatory memorandum in respect of that section.
In respect of the provision it provides:
“A number of employers have interpreted a similar requirement to sub-section 97B(2)[now s.335(2)] in pre reforms section 170LK(5) to mean that the employee must tell the employer directly of their request (see, for example, CFMEU v S.J. Weir Pty Ltd (PR947609)). However, an employee may inform their bargaining agent that they wish them to meet and confer with the employer about the agreement. The bargaining agent may then inform the employer of the employer’s request…”
[Annotation and emphasis added].
Section 15AB(1) of the Acts Interpretation Act permits the use of extrinsic material in the interpretation of an act. An explanatory memoranda is extrinsic material; section 15AB(2)(e). If that material is capable of assisting in the ascertainment of the meaning of the provision consideration may be given to that material to:
“…
(a) Confirm that the meaning of the provision is the ordinary meaning conveyed by the text…; or
(b)To determine the meaning of the provision when:
(i)The provision is ambiguous or obscure…”
Use of such material is subject to subsection 3 which requires that in considering the use of that material regard shall be had to the desirability of persons being able to rely on the ordinary meaning conveyed by the text of the provisions taking into account its context in the Act and the purpose or object underlying the Act; section 15AB(3)(a).
The principle objects of the Act are provided for in section 3. That section relevantly provides:
“3. The principle object of this Act is to provide a framework for cooperative workplace relations…by
…
(b) establishing and maintaining a simplified national system of workplace relations;
…
(d) ensuring that, as far as possible, the primary responsibility for determining matters effecting the employment relationship rests with the employer and employees at the workplace or enterprise level; and
(e) enabling employers and employees to choose the most appropriate form of agreement for their particular circumstances;
…
(h) supporting harmonious and productive workplace relations by providing flexible mechanisms for the voluntary settlement of disputes.”
In this case the identified ambiguity or obscurity in the words of section 335(3) are as to whether an employer is entitled to be informed of the request pursuant to which the bargaining agent has been appointed. As noted above the need for notice in the circumstance is axiomatic and flows naturally from the language of the provision.
The provision is not alleged to lead to a result that is manifestly unreasonable. Indeed the explanatory memorandum appears to confirm the ordinary meaning of the words. That is to say the bargaining agent must identify itself to the employer by informing the employer of its appointment as a precondition of the employer giving it a reasonable opportunity to meet and confer. It follows that having considered the extrinsic material it does not assist because the words in section 335(3) are not ambiguous or obscure; see Amos v Brisbane City Council [2005] QCA 443 at [23] – [32]. In any event it confirms that the meaning of the provision is the ordinary meaning conveyed by the text of the provision.
Clearly before an employer can give a bargaining agent a reasonable opportunity to meet and confer the employer must be aware that a purported bargaining agent is indeed such.
The Act is silent on how a bargaining agent might inform an employer of its status. No process or form is provided for that purpose. Arguably that is unsurprising given the material objects of the Act as I have earlier identified them. Given these matters largely arise at the enterprise or workplace environment it seems plain the legislature did not wish the trappings of formal process to be imposed upon dealings between employers and employees at that level.
While I accept the employer had to be informed of the employee’s appointment I do not consider the legislation requires that any formal notice of such appointment is required. In each case whether that has occurred is a question of fact to be ascertained from all of the circumstances.

By whom must notice be given

Nothing in the section suggests any particular individual bears the onus of providing notice. It follows notice of appointment could be provided by either of the employee or the bargaining agent.

Was Achieve given notice of appointment of bargaining agent?

Given my construction of section 335(3) it is plain a knowledge element must be established to demonstrate a contravention of it. The applicant concedes the respondent’s representatives were not directly advised by it that it had been appointed as a bargaining agent and were not provided at any material time with a copy of the certificate under section 335(6). Although the applicant correctly notes that section 335(3) does not on its face require that knowledge was present it is plain that in the absence of knowledge an employer cannot contravene any obligation to give a bargaining agent a reasonable opportunity to meet and confer with the employer about the agreement. Whatever else may be submitted about the meaning of section 335(3) it is plain that the provision is not intended to import an ambit obligation.
It is accepted that the applicant never directly informed the respondent of its appointment as bargaining agent. The Respondent submits the applicant’s correspondence refers to the applicant representing the respondent’s employees generally and does not make it clear it was acting upon a request made by an individual. It submits that it follows there was insufficient certainty or clarity of the applicant’s appointment as a bargaining agent within the meaning provided in the Act.
First concerning the multiplicity of appointment submission – it is plain from the Act that even a sole employee may appoint a bargaining agent and once appointed the bargaining agent may represent, meet and confer about the making or variation of an agreement. Given that when the certificate issues from the Workplace Authority it must not identify the employee concerned it seems immaterial whether the bargaining agent represents one or a multiplicity of employees. I do not think that the reference in the applicant’s correspondence to the respondent of it representing the respondent’s employees generally, or otherwise, has any bearing upon whether the respondent ought to have appreciated it was a bargaining agent for an employee corresponding with it in that context.
I consider from the context that the respondent ought reasonably have understood the correspondence of 10 December and subsequent correspondence manifest evidence of the applicant’s appointment as a bargaining agent for an employee in the circumstances. First the applicant identified itself as “representing the employees”; it referred to its members advising it (the applicant) of the respondent’s proposal “to make a collective agreement with them”; it requested the applicant meet with the respondents to “discuss your proposals [relating to the collective agreement].” The letter in its form addressed each of the matters relevant to the applicant’s appointment as a bargaining agent as required by section 335(1). Those matters were restated in later correspondence by the applicant to the respondent.
In addition there was a history of extensive prior dealings by both the applicant and another union with the respondent in respect of industrial matters. The respondent could not reasonably be seen to be naïve or unaware of the significance of the import of those words. In my view the letter would have satisfied any reasonable employer of the appointment of the applicant as a bargaining agent in this negotiation.
By inference the respondent contends that the letters themselves should be accepted as an approach by an inter-meddler. Clearly such an inference is fallacious.
The applicant’s employee, Mr Jones, had previous dealings on wages matters with the respondent on numerous prior occasions. On the subject occasion he not only was identified as the contact in the correspondence he also made numerous telephone calls to the respondent leaving his details with various officers of the respondent advising of the purpose of his call, that is to discuss the new employees’ collective agreement.
In my view the facts objectively establish the respondent had actual knowledge of the applicant’s appointment as bargaining agent for an employee in the negotiations in respect of the proposed ECA. I am satisfied of that matter beyond reasonable doubt.
If I am wrong and the facts are not sufficient to demonstrate actual knowledge of notice the applicant contends, and I accept, that in any event there is sufficient evidence of constructive knowledge of that matter in this case.
The concept of constructive knowledge has been well recognised in the construction of provisions in penal statutes; see Barnard John Cooper v Director Liquor Licensing [1999] WASCA 1021; Tabe v R (2005) 79 ALJR 1890 at 1914; R v Crabbe (1985) 156 CLR 464. The doctrine treats the necessary knowledge as having been acquired when the person required to have the knowledge fails to make enquiry or demonstrates wilful blindness. In R v Crabbe at 470 the Court said:
“When a person deliberately refrains from making enquiries because he prefers not to have the result, when he wilfully shuts his eye for fear that he may learn the truth, he may for some purposes be treated as having the knowledge when he deliberately abstained from acquiring.”
As I have earlier noted the correspondence forwarded by the applicant to the respondent clearly identified those elements warranting the appointment of a bargaining agent. The prospect of the applicant’s acting in that capacity is a matter which also ought to have been apparent from the context. At the material time the respondent was engaged in bargaining with its employees in respect of a new ECA. The applicant had been engaged with the respondent on the relevant worksite for some months prior to the events of December 2008. The letters were forwarded and telephone messages were left making it plain that the purpose of the applicant’s involvement was to negotiate in respect of the proposed collective agreement. Furthermore the applicant’s successful efforts to communicate with the respondent were confined to that period immediately following the respondent’s commencement of negotiations with its employees and largely concluded with the submission by the respondent to the Workplace Authority of the ECA. There is no suggestion that during this discrete period of time the applicant and respondent were engaged in any other communications.
In the event it was not plain to the respondents beforehand it ought to have been plain to it after its receipt of the applicant’s letter of 16 December when the applicant referred to the Act and to the respondent’s obligations to “gives (sic) a reasonable opportunity to meet and confer with you before the agreement is approved”. That was a clear reference to section 335(3). In the context the respondent ought to have appreciated the applicant was asserting its right as a “bargaining agent” pursuant to section 335(3). Implicit in that assertion was the matter of its appointment. The applicant’s assertion in that context could lead to only one reasonable conclusion that being that the applicant was a duly appointed bargaining agent pursuant to section 335(3).
Clearly the respondent simply sought to ignore the applicant’s advances. Its motive to lie low and ignore the applicant and not engage as required pursuant to section 335(3) was disclosed by the observations of Messrs Powell and Lawson who attended the Rotary Park meeting stating “we are not dealing with the LHMU in this. We do not want the unions involved.”
The respondents have not challenged the applicant’s evidence concerning both the correspondence and telephone communications directed to it. Nor have they challenged any of the particulars of those matters. I am satisfied that in the context the respondent knew or ought to reasonably have known that the applicant sought to engage with the respondent as a bargaining agent.
In that event I am satisfied the respondent had constructive knowledge of the appointment of the applicant as bargaining agent and that it failed to give the applicant as bargaining agent a reasonable opportunity to meet and confer with the respondent about the agreement during the relevant period. I also am satisfied of this matter beyond a reasonable doubt.

Penalty

The maximum penalty for a contravention of this section in accordance with section 407(1) and 407(2) is 150 penalty units or $16,500. For the applicant it was submitted that matters relevant to the imposition of penalties in cases of this kind include any loss incurred as a consequence of the contravention, deterrence, the flagrancy and deliberateness of the breach, the offender’s past behaviour and any contrition displayed by the offender. So far as is relevant it was submitted that:
a)The breach was serious and flagrant demonstrating a refusal to recognise the rights of an industrial organisation with an important role to play under the Act. The facts clearly support this contention. The applicant corresponded on three occasions in the space of a little over a week. It did not receive the courtesy of a reply to that correspondence. Furthermore the applicant by its officer Mr Jones left telephone messages with four members of the respondent’s senior staff and attempted on one occasion to have a message passed to the respondent’s executive manager. These telephone messages were left at a time when negotiations were taking place between the company and employees directly and in respect of which it was plain that the respondent was seeking to freeze out the applicant.
b)Mr Sawyer was denied the right to be represented in negotiations for the agreement and thereby possibly denied improved conditions. Coincidentally other employees who may have benefited from Mr Sawyer’s request for the appointment of a bargaining agent were possibly likewise prejudiced.
c)There is a need to deter such conduct in the context of the Act which clearly provides employees with the right to be represented in negotiations and that this right should be protected. As has been earlier noted the principal objects of the Act include an object to ensure that compliance with minimum standards and bargaining processes and enforcement of the rights and obligations of employers and employees in their organisations. Fulfilment of that object will promote economic prosperity and the welfare of the people of Australia. In that regard the deterrent aspect is especially significant. In a competitive marketplace it is important that all participants compete on a level playing field. If this sort of conduct is tolerated and or permitted to go unchecked inefficiencies will ensue to the detriment of all; competitors, consumers and other associated participants such as employees.
The respondent has shown no contrition nor sought to ameliorate any damage that may have been sustained. No evidence has been led to demonstrate the sustaining of any damage. It may be that the applicant’s involvement may have achieved a better industrial outcome for the person who appointed the applicant as his bargaining agent and perhaps other employees. However that is a matter of conjecture. Irrespective of that matter the respondent’s conduct of this proceeding manifests a complete lack of contrition. In my view the conduct of the respondent in this instance was reprehensible. There was no justification for it. The respondent cannot expect any discount on account of contrition or cooperation with the prosecuting authorities.
I note the respondent has no previous contraventions of a similar kind. That matter is relevant to penalty.
Overall I consider this to be an egregious contravention and one warranting a significant penalty. Having regard to the matters that I have earlier identified I consider a penalty of 100 penalty units or $11,000 appropriate.

Payment of penalty

The applicant submits that the court should order pursuant to section 841 of the Act that the penalty be paid to it. It contends that such an order is usually warranted where an industrial organisation brings proceedings for a contravention of the Act to protect the legitimate interests of its members; CF Finance Sector Union v Commonwealth of Australia (2005) 47 IR 462 at 482 – 483; Rojos v Esselte Australia Pty Ltd (No.2) [2008] FCA 1585 at [68] – [69]; National Tertiary Education Industry Union v Central Queensland University (2008) FCA 481. In my view this is an appropriate case for the exercise of the discretion in this instance in favour of the applicant.

Orders

That pursuant to section 407(1) and section 407(2)(b) of the Workplace Relations Act the respondent pay a pecuniary penalty fixed in the sum of $11,000.00 for contravention of section 335(3) of the Workplace Relations Act.
That pursuant to section 841 of the Workplace Relations Act the penalty imposed on the respondent pursuant to Order 1 herein be paid to the applicant.

I certify that the preceding seventy-four (74) paragraphs are a true copy of the reasons for judgment of Burnett FM

Associate: B Schmidt

Date: 26 May 2010